Prosper Canada response to COVID-19

23 March 2020
It has been a tumultuous two weeks and, like you, we have been adjusting to remote work, conferring with staff and partners to address urgent needs, and reassessing our 2020-21 organizational priorities in light of COVID-19’s impact.
 
Safeguarding the well-being of employees and volunteers.
 
Our first obligation is ensuring the health and well-being of our employees and volunteers.  Prosper Canada remains fully operational, but all staff are working remotely, and we have suspended all travel and in-person meetings for the safety of employees, volunteers and the broader community. We have reviewed and adapted our leave policies to ensure staff can stay home if sick and have the flexibility they need to care for children and other family members.
 
Supporting our partners to adapt services to meet community needs
 
Community service providers across Canada are struggling to adapt their service models to protect the health of their staff, volunteers and clients, while still meeting critical and growing needs. In some cases, this means suspending services temporarily until a new approach can be designed and put in place.

This includes free tax clinics and one-on-one benefit assistance to connect people with low incomes to vital income support programs. For example, over 700,000 vulnerable Canadians currently rely on the Community Volunteer Income Tax Program to access $1.9 billion in income benefits. Prosper Canada’s 14 Financial Empowerment Champion partners currently serve 19 per cent of this population.
 
These services are a critical lifeline for the most vulnerable who are not able to successfully tax file or access benefits on their own due to language, literacy, digital literacy, disability, mental health and systemic barriers. Without these services, many will not be able to access income they need to meet basic needs or, under current rules, see their existing benefits lapse if they fail to requalify by tax filing.
 
That is why Prosper Canada is collaborating with nonprofit partners to:
 
  • Share daily on the impact of COVID-19 on tax and benefit services
  • Share newly adapted service models that integrate social distancing and make greater use of telephone and video-conference support
  • Identify issues and solutions for advocacy action
Keeping partners and Canadians informed
 
At the same time, we are working closely with the Canada Revenue Agency and other federal departments to help inform, monitor and communicate actions the government is taking to ensure all Canadians have access to the resources they need in this critical period. These measures include the announcement on March 18th of an important suite of new benefits and financial relief measures for Canadians:

  • A new Emergency Care Benefit and Emergency Support Benefit available to all workers affected by COVID-19
  • Top-ups to the Canada Child Benefit and GST Credit
  • Postponement of the tax filing deadline for individuals to June 1, 2020
  • Deferment of payment on new tax amounts owed deferred to August 31, 2020
  • A six-month moratorium on Canada Student Loan payments
We will also be monitoring and sharing steps financial institutions and utilities are taking to help customers manage emerging financial challenges.
 
Our Managing financial well-being in tough times toolkit contains some initial resources, but we will be building this out in  the weeks and months ahead.
 
Working to build the financial resilience of low and moderate-income households
 
COVID-19 has shown us how financially unprepared most households are for a serious emergency, particularly one that may last a year or more. Even pre-crisis:
 
  • Fifty per cent of working Canadians lived paycheque to paycheque
  • One third of households were “asset poor”
  • 10 million working age Canadians had no workplace retirement plan
  • The median retirement savings of households without workplace pensions was just $3,000
  • Consumer debt was at or near all time-highs
  • Personal insolvencies were at their highest level in a decade
Households are now seeing their employment and earnings dramatically undercut by calls for affected workers to self-isolate; the need for social distancing; the shuttering of many businesses, schools and community services; widespread layoffs, and an explosion of caregiving demands as schools, childcare and other community programs close.
 
Canadians with low and modest incomes will be the most severely affected by these dramatic changes.
 
Those who are precariously housed will find it impossible to self-isolate, higher rates of chronic disease will make them more vulnerable should they get sick, and they will be more challenged to navigate government benefit systems. They are also the most likely to see key services they depend on disappear in the days and weeks ahead.
 
The need for accessible, quality financial help for these households has never been greater.
 
That is why Prosper Canada is calling on governments to invest in community financial help services, building on successful Financial Empowerment Champion Pilots that have helped over 329,500 vulnerable Canadians to build their financial health over the past four years and enabled over 142,000 of these to access approximately $720 million in new income – all at an average cost to government of $19 per person.
 
We are actively advocating for a federal investment of $20.7 million over 5 years to extend this program to twenty cities to serve 500,000+ people with low and moderate incomes and boost their incomes by over $1 billion dollars.
 
Current Financial Empowerment Champions are rapidly adapting their service models to help people virtually and are our best chance right now for connecting many of our most vulnerable Canadians to urgently needed income and other community services. By providing struggling families with unbiased, expert help from community organizations they trust, we can help them through this crisis and to rebuild financially in its aftermath.
 
Laying the foundation for financial health in the 21st Century
 
COVID-19 has also thrown into stark relief the inadequacies of our current income support systems when it comes to responding to people in urgent need and ensuring equitable treatment for precarious, as well as permanent, workers. These inadequacies are compounded by the fact that many Canadians were caught carrying record levels of household debt and little or no emergency savings when COVID-19 hit.  
 
Canadians are weathering the current financial crisis so far because we have responsive governments, deep reservoirs of social trust and cooperation, and a vibrant civil society. But when we emerge from this crisis, shouldn’t job one be to ensure that we are much better prepared for the next one?
 
Now is the time to start thinking about the financial security system we need for the 21st century. Here are a few ideas we will be pursuing in parallel to our work with partners to meet immediate needs:
 
  • Build more flexible, inclusive and responsive income support programs that assume many Canadians will be precariously employed and support all workers to successfully transition between the paid workforce, education and training, caregiving and retirement;
  • Establish portable insurance and retirement savings programs that enable all workers to pool risk, build financial security and provide for their future;
  • Incentivize low and modest-income Canadians to save for emergencies and the longer term to the same extent that we reward higher income Canadians who save and build wealth;
  • Make sure people with low and moderate incomes have access to the financial products, services and advice they need to build financial their health, even if serving higher income Canadians offers greater profits.
  • Build financial education, counselling, and/or tax and benefit help into public services that people with low incomes rely on (e.g. welfare, employment, shelter, housing and primary healthcare), where evidence shows it will make these services more effective and improve service users’ financial health.
  • Invest in free community financial help centres to support Canadians on low income and other vulnerable populations to achieve greater financial security.
  • Streamline application processes or automate enrolment in key government benefits to ensure they flow to all who are eligible.
We are all in this together

If an epidemic teaches us anything it is that societies – like chains – are only as strong as their weakest links.
 
When the pandemic recedes, Canada will emerge more resilient than most other nations because Canadians understand that the only way through this is to reach across traditional divides and to help each other.  
Let’s not waste this lesson but use it to breathe new life into outdated income security programs and to foster new approaches to building the financial security of all Canadians.
 
We welcome your ideas and advice as we chart our way forward and your thoughts on how we can help you in your own efforts to support Canadians at this time.
 
We are all in this together and this is everybody’s job now.  
 
Liz Mulholland
CEO, Prosper Canada